What is an Agency?
An agency is a connection between two groups. One party is known as the agent while the other is called the principal. The agent, which is the second party, represents the first party, the principal, in daily transactions. The principal hires the agent to carry out tasks on its behalf. The principal allows the agent to represent them in decision-making.
In general, an agency is an organization handling transactions and other business activities on behalf of another business or person. According to their role, five agencies can be seen,
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General agency
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Special agency
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Subagent
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Agency coupled with interest
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Servant
Agencies and Financial Needs
Firms that deliver loads of project work, including technology and creative agencies, experience issues with cash flow. Since the agencies pay the staff and freelance workers beforehand, cash flow issues generate. This arises from waiting 30 to 90 days for remuneration for work and the associated difficulties.
Most agencies do not possess enough reliable assets. With many of the agencies being young, they face difficulty when generating cash flow through traditional finance options. Banks and other lenders often hesitate to provide these young agencies with finance.
Fintech firms play a major role in supporting young and potent agencies. Accordingly, with the wide usage of mobile phones and internet, agencies can obtain finance through fintech firms and their brands. Here, creative agencies and tech agencies gain the upperhand.
Fintech firms can provide a range of funding solutions that are flexible according to the needs of the agency. Agencies can obtain these funds to boost their cash flow and growth.
